Monday, March 17, 2014

Tesla Sales Ban = Free Advertising

A couple years back Sodastream (SODA) produced a commerical that took a direct shot at Coke and Pepsi for the waste their plastic bottles created. Fearing backlash from the big two soft drink makers, the commercial was banned from the big game but created over 4 million views to date on youtube. Sodastream hired Scarlett Johansson for this year's big game spot and her sign off phrase "Sorry Coke and Pepsi" got the company's ad banned again. It was later modified and aired without the antagonistic language. This time over 13 million views were registered on Youtube. Why does this matter?

The direct sales bans Tesla is facing in New Jersey and potentially New York and Ohio are going to activate the groundswell of support for Tesla from the company's hard core followers who love the car, drive the car and want to buy the car. The dispute is likely to be discussed all over the news with protests and demonstrations, creating both tons of free advertising for the Tesla and political pressure on legislators to change the state law or stop the ban.  We will no doubt read about people traveling to neighboring states to take a test drive. Who could rule out a parade of Tesla's rolling past state houses?

Some people are worried that these sales bans will have a negative impact on Tesla. From what we have seen with Sodastream, getting banned can work in the opposite direction. Tesla is about to get a lot more visibility in the coming months. This is a good thing as the voice of the people will be heard. Our guess is this voice will be heard sooner rather than later.


Foundry Stock Review and its contributors have no positions in Tesla (TSLA) or Sodastream (SODA)  the security detailed in this blog as of 3/17/2014. Periodically, Foundry Stock Review or its contributors may initiate a position in a stock covered in this blog. If we do initiate a position in any security we cover prior to publication, we will disclose the position here in our disclosure. This stock disclosure is not a recommendation to purchase or sell any security.


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